The Federal Trade Commission and Justice Department have jointly announced they are suspending early terminations of merger reviews, citing an "unprecedented" volume of proposed mergers for the start if the fiscal year.
Early terminations are the notifications that a merger submitted for Hart-Scott-Rodino (HSR) antitrust review will not be blocked or conditioned, and so has received an early end to that antitrust review.
Justice and the FTC divvy up the reviews, with Justice handling communications mergers but FTC announcing the terminations for deals submitted for the pre-merger review. All mergers over a certain dollar threshold (currently $90 million) must submit to the reviews, with the FTC announcing the early terminations.
But during the transition to the new administration while it is reviewing "process and procedures" for granting the early terminations, and given the volume of the HSR filings, the FTC said, neither agency will grant early termination.
The FTC said it expected the suspension of the process should be "brief."
“We, as an agency and a country, are in unprecedented times, and our obligation is to be responsive to these circumstances, in this case by temporarily suspending early termination,” said acting FTC chair Rebecca Kelly Slaughter
Sen. Amy Klobuchar (D-Minn.), who is introducing legislation to reform the merger review process, and who has had issues with Big Tech purchases of smaller start-ups that have flown under the antitrust radar, including by not rising to the pre-merger value, suggested the move buttressed her case for legislation.
“The FTC and Justice Department’s announcement makes two things clear," she said in an e-mailed statement. "First, as enforcers are having trouble even keeping up with incoming merger filings, the agencies need more resources and staff to effectively protect consumers and competition." Her bill would boost funding.
"Second, despite the pandemic, market consolidation is alive and well," she said. "We know that we can’t take on this problem with duct tape and band aids"--a point she made in announcing her bill this week. "[W]e must ensure that enforcers at the FTC and Justice Department have the resources they need to tackle our competition problems. I [have] announced a bill that would do just that.”
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